Energy efficiency is moving from a cost-saving option to a market-access requirement for Pakistan’s textile industry.
Pakistan’s textile sector must accelerate energy audits, carbon accounting, energy management systems and life-cycle analysis to protect export competitiveness as EU buyers tighten climate and sustainability requirements, policymakers and development partners warned at a workshop in Islamabad on May 21, 2026. The event was jointly organised by the Danish Energy Agency, SDPI, NEECA and the Embassy of Denmark.
Compliance becomes commercial
German Ambassador Ina Lepel said exporters unable to demonstrate verified environmental performance risk losing contracts to competitors with better emissions data. The warning is particularly important for Pakistan because textiles generate roughly 60% of national export earnings, making the sector highly exposed to changes in European sourcing standards.
The EU’s current CBAM scope covers six sectors—cement, aluminium, fertilisers, iron and steel, hydrogen and electricity—not textiles directly. But the wider regulatory direction is clear: suppliers will face rising pressure to provide credible carbon, product-impact and supply-chain data. The EU textile strategy also includes plans for a Digital Product Passport, alongside requirements linked to durability, repairability, recyclability and transparency.
Energy efficiency as export defence
Danish Ambassador Maja Mortensen said Pakistan’s challenge was now implementation, not planning. She linked energy efficiency with economic resilience, energy security and industrial competitiveness, and noted that Pakistan and Denmark have entered a three-year Strategic Sector Cooperation in energy that will continue until 2029.
Senior technical expert Fridolin Holm said Pakistan’s textile industry remains highly energy-intensive, using about 28% of industrial electricity and 40% of industrial gas. He recommended a layered compliance approach beginning with ISO 50001, metering systems and structured energy audits to support emissions reporting, cost reduction and investment planning.
SMEs need finance and technical support
Speakers from SDPI, NEECA, the National Compliance Centre and NPO stressed that SMEs lack the technical skills, financing and management systems needed for climate compliance. Proposed measures included green financing facilities, subsidies, carbon audits, cleaner technology adoption and stronger public-private coordination.
The next test is practical delivery: Pakistan must turn audits, LCA and energy management from donor-funded pilots into routine industrial systems across mills, laundries, dyehouses and garment factories.
